Tahatan-Bey v. Nationstar Mortgage LLC

Background

This case concerns claims about mortgage financing, foreclosure, and the sale of property identified in the opinion as 2013 Mt. Hamilton Drive, Antioch, California. The complaint was initially filed in Contra Costa County Superior Court and removed to federal court by Nationstar Mortgage LLC.

The amended complaint asserted claims involving due process and the takings clause; alleged fraudulent misrepresentation based on an IRS form; violations of the Fair Debt Collection Practices Act; and alleged “equity theft” through improper securitization and assignment. The plaintiffs also argued that Nationstar used an incorrect employer identification number and falsely claimed ownership of the property or the right to sell it.

Motions and Analysis

The plaintiffs moved to remand the case to state court, arguing that federal-question jurisdiction was absent. After they filed a First Amended Complaint expressly alleging federal claims, the court held that the remand motion was moot and denied it. The court also denied a renewed request for remand because both the original complaint and the amended complaint alleged federal claims.

Nationstar moved to dismiss. The court considered the amended complaint on its merits despite Nationstar’s argument that it was filed too late. The court held that the claims were barred by a prior vexatious-litigant order and by res judicata, the rule that prevents a party from relitigating claims that were already decided or should have been brought in an earlier case. The court said all of the claims concerned the same mortgage foreclosure and property sale and therefore were claims that had been raised or should have been raised in prior proceedings.

The court rejected the plaintiffs’ argument that the alleged false IRS form created a new claim. It concluded that the argument was another version of previously rejected claims concerning mortgage securitization, Nationstar’s status, and its authority to foreclose. The court also stated that adding Tanya Stutson-Bey as a plaintiff did not avoid the effect of the prior vexatious-litigant order because the order applied to the filing associated with the first two named plaintiffs.

Ruling

The court denied the motion to remand. Judge William H. Orrick granted Nationstar’s motion to dismiss with prejudice. The court dismissed the claims with prejudice, directed the Clerk to enter judgment in Nationstar’s favor, and ordered the case closed.